Spongetech Delivery Systems Inc. (OTC BB: SPNG) today, announced its first $1.5 million sponge order from South America. After word of the sale, shares jumped 60 percent to 24 cents on volume of 1,224,360.
I don’t know why it’s funny to write about sponges – but it is. The numbers backing the sponges, however, aren’t. The sale agreement with SA Trading Group Corp. includes 250,000 units (1/5 kits and 1/5 singles) of the car cleaning sponges to be delivered to South America between September 15, 2007 and October 10, 2007.
The company said the language on the kit packages will be translated to cater to the new market to enhance sales and distribution.
“The underlying benefit to this operation is the fact that we’ve translated it into Spanish as well as Portuguese which opens up a larger market area for us to extend the product in to,” Bill Young, head of Investor Relations for Spongetech, told Market News First.
Young said the demand for the sponges is increasing – the company is looking to move into the European market throughout the next few years.
But they make sponges everywhere, right? Not environmentally friendly ones. The sponges are proprietary to Spongetech – they require little water, no bucket, and are biodegradable. It’s a sponge and rinse process.
“You realize, every time you’re using a sponge, how many gallons of water you’re saving. It’s really the key to what the success of the product is,” said Young. “That’s why it’s going to continue to grow.”
Responding to drought and limited water resources in the summer, some cities may implement water restrictions – residents can be fined not only for watering their lawn, but for washing their cars as well. The green sponge eliminates that risk and lessens the amount of contaminates entering the sewage line.
As company executives are on the move to explore the European market, the company shares continue to rise.
“We’re hoping to do even better – there are really not a lot of shares out there,” concluded Young. “Once we’ve got everything in place we think the stock should move a lot higher than it is.”
The company’s first-quarter results are to be released soon – MN1 will follow with an update on the movement in the stock and international markets.